<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
---------------------
Date of Report (Date of earliest
event reported) October 28, 1998
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Iridium World Communications Ltd.
(Exact name of registrant as specified in its charter)
Bermuda 0-22637 52-2025291
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda
(441)295-5950
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
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Iridium LLC
(Exact name of registrant as specified in its charter)
Delaware 0-22637-01 52-1984342
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
1575 Eye Street, N.W., Washington, DC 20005
(202) 408-3800
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
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Iridium Operating LLC
(Exact name of registrant as specified in its charter)
Delaware 0-22637-02 52-2066319
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
1575 Eye Street, N.W., Washington, DC 20005
(202) 408-3800
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
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Iridium Capital Corporation
(Exact name of registrant as specified in its charter)
Delaware 333-31741-03 52-2048739
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
1575 Eye Street, N.W., Washington, DC 20005
(202) 408-3800
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Iridium IP LLC
(Exact name of registrant as specified in its charter)
Delaware 333-31741-01 52-2048736
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
1575 Eye Street, N.W., Washington, DC 20005
(202) 408-3800
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Iridium Roaming LLC
(Exact name of registrant as specified in its charter)
Delaware 333-31741-02 52-2048734
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
1575 Eye Street, N.W., Washington, DC 20005
(202) 408-3800
<PAGE> 3
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Iridium Facilities Corporation
(Exact name of registrant as specified in its charter)
Delaware 333-44349-04 52-2083969
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
organization) Number)
1575 Eye Street, N.W., Washington, DC 20005
(202) 408-3800
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Item 5. Other Events
On October 28, 1998 and November 1, 1998, Iridium LLC issued press
releases, copies of which are attached hereto as Exhibit 99.1 and Exhibit 99.2,
respectively. Many of the statements in the attached press releases are forward
looking and actual results may be materially different from those expressed or
implied by these statements. Forward looking statements are based on a number
of assumptions, and one or more of these assumptions is likely to be incorrect.
Examples of forward looking statements include statements concerning; the date
of commencement of Iridium World Page Service, pager testing, satellite
maintenance launch schedule, the expected progress of improvements and
software enhancements, expected operational and software improvements, the
transition to commercial service, gateway status, handset and pager production
schedules and volumes, handset and pager demand levels, certain licensing and
regulatory approvals, the integration of service providers and roaming
partners, customer leads and other sales-related data and the expected markets
for Iridium services. In particular, many of these statements assume that
Iridium will transition smoothly from a development stage company to an
operating company. For a description of factors which may cause results
for Iridium to be materially different from those expressed or implied by such
forward looking statements, consult "Certain Factors Which May Affect Forward
Looking Statements" filed as Exhibit 99 to the Annual Report on Form 10-K of
Iridium World Communications Ltd. ("IWCL") and Iridium LLC for the fiscal year
ended December 31, 1997 and Exhibit 99.1 to the Quarterly Report on Form 10-Q
of IWCL and Iridium LLC for the quarter ended June 30, 1998, which are
incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Statements and
Exhibits.
(c) The following exhibits are filed herewith.
Exhibit Number Description
99.1 Press release dated October 28, 1998.
99.2 Press release dated November 1, 1998.
99.3 Certain Factors Which May Affect Forward Looking
Statements: Incorporated by reference to Exhibit 99
to the Annual Report on Form 10-K of Iridium World
Communications Ltd. ("IWCL") and Iridium LLC for
the fiscal year ended December 31, 1997.
99.4 Certain Factors Which May Affect Forward Looking
Statements: Incorporated by reference
1
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to Exhibit 99.1 to the Quarterly Report on Form
10-Q of IWCL and Iridium LLC for the quarter ended
June 30, 1998.
2
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
each registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
IRIDIUM WORLD COMMUNICATIONS LTD.
By /s/ EDWARD F. STAIANO
------------------------------------
Name: Edward F. Staiano
Title: Chief Executive Officer
IRIDIUM LLC
By /s/ F. THOMAS TUTTLE
------------------------------------
Name: F. Thomas Tuttle
Title: Secretary
IRIDIUM OPERATING LLC
By /s/ F. THOMAS TUTTLE
------------------------------------
Name: F. Thomas Tuttle
Title: Secretary
IRIDIUM CAPITAL CORPORATION
By /s/ F. THOMAS TUTTLE
------------------------------------
Name: F. Thomas Tuttle
Title: Secretary
IRIDIUM ROAMING LLC
By /s/ F. THOMAS TUTTLE
------------------------------------
Name: F. Thomas Tuttle
Title: acting secretary
IRIDIUM IP LLC
By /s/ F. THOMAS TUTTLE
------------------------------------
Name: F. Thomas Tuttle
Title: acting secretary
IRIDIUM FACILITIES CORPORATION
By /s/ F. THOMAS TUTTLE
------------------------------------
Name: F. Thomas Tuttle
Title: Secretary
Date: November 4, 1998
3
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EXHIBIT INDEX
Exhibit Number Description
99.1 Press release dated October 29, 1998.
99.2 Press release dated November 1, 1998.
99.3 Certain Factors Which May Affect Forward Looking
Statements: Incorporated by reference to Exhibit 99
to the Annual Report on Form 10-K of Iridium World
Communications Ltd. ("IWCL") and Iridium LLC for the
fiscal year ended December 31, 1997.
99.4 Certain Factors Which May Affect Forward Looking
Statements: Incorporated by reference to Exhibit
99.1 to the Quarterly Report on Form 10-Q of IWCL
and Iridium LLC for the quarter ended June 30, 1998.
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EXHIBIT 99.1
[IRIDIUM LETTERHEAD]
IRIDIUM LLC REPORTS THIRD QUARTER RESULTS
Commercial Service Set to Begin November 1
(NASDAQ: IRIDF)
(Washington, D.C. - October 28, 1998) Iridium LLC during the third quarter made
substantial progress toward meeting its goal of achieving worldwide service
availability on November 1, 1998. The company successfully launched seven
additional satellites aboard two launch vehicles. Iridium also advanced its
technical, infrastructure, licensing, marketing and distribution activities
during the quarter to enable achievement of its planned service introduction on
November 1.
"Our progress in the third quarter has made commercial availability of the
Iridium system on November 1st a reality," said Edward F. Staiano, Vice Chairman
and CEO of Iridium LLC. "Commercial service availability is the first of many
steps Iridium will take, as we strive to enhance and improve the technical
performance of our network and add new services and advanced features, to
collectively deliver what will be the most comprehensive wireless service the
world has ever seen," he continued.
The Iridium satellite constellation is now complete, ground control facilities
operational, and all 12 gateways are staffed and functioning. On November 1st,
Iridium plans to offer worldwide satellite telephony, cross-protocol cellular
roaming, and calling card capabilities. Paging services will follow shortly
thereafter with availability of production equipment from Motorola in
mid-November.
Trials commenced during the third quarter, validating the system design,
architecture and service features. Thousands of calls were made worldwide during
the quarter. Call completion rates and overall call performance has improved
steadily with the introduction of new software uploads and is now at
commercially acceptable levels. Testing of paging
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functionality was delayed nominally due to concentration of efforts on voice
performance. However, commencement of testing has yielded extremely positive
results enabling production of commercial pagers to proceed. Feedback from
individual, corporate and industrial trial participants worldwide has been
positive.
During the third quarter, a Long March 2C/SD rocket manufactured by China Great
Wall Industries Corporation carried two Iridium satellites into orbit. This
launch was followed by a Boeing Delta II which carried five additional
satellites into orbit. Three of the seven satellites launched filled gaps in the
operational constellation, while four will serve as spares for future
constellation replenishment. Another Delta II launch is scheduled for launch in
early November and a Chinese Long March 2c/SD is scheduled to carry two
additional satellites into orbit in early December for constellation
maintenance.
The latest upgrade of the constellation software has been successfully uploaded
throughout the network and test results have demonstrated considerable
improvements in system performance, including robust L-band availability,
crosslink functionality, call establishment and completion, and dropped call
rates. Software enhancements will be ongoing as the system matures and
commercial customers are provisioned. Messaging trials, including testing of
alpha and numeric paging capabilities, short messaging services, and voice mail
are confirming product and system integrity and demonstrating excellent
performance.
Motorola handsets will be available in sufficient quantities to support the
demand shortly after commercial activation. An initial shipment of 5,000
handsets will be shipped to the gateways prior to commercial activation with
incremental shipments to follow in the weeks and months thereafter. Kyocera has
made substantial progress with software development and expects 4,800
satellite-only and 9,400 multi-mode handsets will be available in November.
Motorola pagers are currently being manufactured and are expected to be
available in commercial quantities mid-November.
Iridium products are the first commercial products to carry the newly approved
International Telecommunications Union "mark", intended to enable subscribers to
carry Iridium products into, and out of, countries without restriction. This
mark will enhance the company's ability to deliver on its promise to provide
global communications services.
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The 12 Iridium gateways are now operating 24 hours a day, seven days a week.
Equipment for the China gateway has been shipped and the installation of
hardware and software is complete. The first successful calls from the Chinese
gateway were made on September 23rd and have continued steadily since. The
gateway is undergoing final readiness testing with the goal of being operational
on November 1st. Acceptance testing of the China gateway is expected to be
completed on October 28, 1998.
The Iridium billing clearinghouse, Iridium gateway business offices, and service
providers and roaming partners around the world are processing call detail
records and exchanging subscriber account information to enable subscriber
activation. More than two million billing records from around the world have now
been processed and tested at this point.
More than 120 countries and territories have licensed the Iridium service,
collectively accounting for more than 75% of the company's anticipated market.
Service availability is expected in as many as 200 countries by year-end,
representing 95% of our business plan.
Distribution agreements have been negotiated with more than 270 distribution
partners. These include some 165 service provider and 155 roaming partner
agreements, providing Iridium access to over 105 million wireless telephone
subscribers in 125 countries and covering 3.6 billion POP's. Service provider
integration and roaming partner compliance testing have been underway for
several months, with some 80 ready for commercial service activation today.
Integration and compliance testing ensure proper signaling, interconnection,
billing system interface, product handling and marketing readiness training.
Integration and compliance testing will be ongoing, as additional service
providers and roaming partners are added.
Iridium's global marketing and advertising programs have yielded outstanding
results. More than 850,000 prospective customers have responded to Iridium
print, broadcast, outdoor, in-flight advertising and direct mail since the
program's inception in late June. Iridium distribution partners, have received
an estimated 200,000 inquiries directly, through co-branded advertising and
direct sales efforts, bringing the total prospect inquiries to more than one
million. Recent focus groups, consisting of telecommunications users who either
made telecom purchasing decisions directly or had influence on their
organization's purchases, reacted favorably to Iridium advertising and expressed
interest in the product.
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Located in the United States, the Netherlands and Australia, Iridium Global
Customer Care Centers continue to receive large volumes of inquiries from
potential customers. These centers operate every day, around the clock, to
accommodate sales activities and to provide subscriber assistance.
For the quarter ending September 30, 1998, costs incurred and capitalized for
the communications systems assets totaled $128 million. Since inception, amounts
capitalized for the communications systems assets have totaled approximately
$3.47 billion. The net loss for the three months ending September 30, 1998, was
$ 364 million.
Iridium LLC is developing and commercializing a global wireless communications
network that will combine the worldwide reach of 66 low-earth orbit satellites
with land-based wireless systems to enable customers to communicate using
handheld telephones and pagers virtually anywhere in the world. Commercial
service is scheduled to begin on November 1, 1998. Iridium World Communications
(NASDAQ: IRIDF) is the public investment vehicle of Iridium LLC.
# # #
This release contains forward-looking statements, including statements regarding
schedules for commencement of service and commercial operation of the Iridium
system. These forward-looking statements are based on a number of assumptions
and actual results may be materially different from those expressed or implied
by such statements. For a description of factors which may cause results for
Iridium to differ materially from those expressed or implied by such
forward-looking statements, please consult the Securities and Exchange Act
filings of Iridium World Communications Ltd. (Nasdaq: IRIDF).
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IRIDIUM LLC
(A DEVELOPMENT STAGE LIMITED LIABILITY COMPANY)
SELECTED FINANCIAL DATA
(DOLLARS IN THOUSANDS EXCEPT PER CLASS 1 INTEREST DATA)
<TABLE>
<CAPTION>
THREE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 1998 SEPTEMBER 30, 1998
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<S> <C> <C>
CONSOLIDATED STATEMENT OF LOSS DATA:
Operating expenses....................................... $ 129,099 $ 261,261
Depreciation and amortization............................ $ 152,627 $ 378,276
Interest expense, net.................................... $ 82,655 $ 173,185
------------------ ------------------
Net loss................................................. $ 364,381 $ 812,722
================== ==================
Net loss applicable to Class 1 Interests................. $ 365,934 $ 817,221
================== ==================
Net loss per Class 1 Interest............................ $ 2.59 $ 5.78
================== ==================
Weighted average interests used in
computing Net loss per Class 1 Interest.................. 141,324,251 141,289,887
================== ==================
</TABLE>
<TABLE>
<CAPTION>
SEPTEMBER 30, 1998
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<S> <C>
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents................................ $ 65,207
Property and equipment - net............................. $ 2,865,070
System under construction................................ $ 523,739
Total assets............................................. $ 3,564,602
Long-term debt (net of discount)......................... $ 1,714,890
Total Members' equity.................................... $ 834,241
</TABLE>
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Iridium is a registered trademark and service mark of Iridium LLC (C) 1998
<PAGE> 1
EXHIBIT 99.2
[IRIDIUM LETTERHEAD]
PRESS RELEASE
THE WORLD'S FIRST GLOBAL SATELLITE TELEPHONE AND
PAGING COMPANY STARTS SERVICE TODAY
Iridium Ushers in New Era of Global Communication
WASHINGTON, November 1, 1998 -- The Global Village just got a whole lot
smaller.
Iridium LLC today announced that the world's first hand-held, global satellite
phone and paging system is now commercially available to customers. With
Iridium phones and pagers, people will have the ability to communicate
virtually anywhere on the face of the planet - using one phone, with one phone
number, receiving one monthly phone bill.
"After 11 years of hard work, we are proud to announce that we are open for
business," said Edward F. Staiano, Iridium LLC Vice Chairman and CEO. "Iridium
will open up the world of business, commerce, disaster relief and humanitarian
assistance with our first-of-its-kind global communications service."
Dr. Staiano noted that Iridium is now fully operational, 24 hours a day, seven
days a week, offering the following key services: satellite voice, cellular
roaming, and calling card. Phones are being produced and shipped to the
regional Iridium Gateways by the two manufacturers, Motorola of the US and
Kyocera of Japan. In addition, global page service will commence in
mid-November.
"The potential uses of Iridium products is boundless," continued Staiano.
"Business people who travel the globe and want to stay in touch with home and
office, industries that operate in remote areas, disaster and relief
organizations that
<PAGE> 2
require instant communications in troubled areas - all will find Iridium to be
the answer to their communications needs."
Using its constellation of 66 low earth-orbit satellites, the Iridium system
provides reliable communications from virtually any point on the globe. From
ships at sea, to the highest mountains to remote locations, Iridium customers
will be able to make and receive phone calls on their Iridium phone. For people
travelling to urban areas in the developed world, Iridium offers a cellular
roaming service featuring dual-mode phones that can be switched to operate with
terrestrial wireless services.
Whether their phone is in satellite or cellular mode, an Iridium customer will
be reachable at a single phone number, anywhere they happen to be. If their
phone is turned off, they can be contacted 24 hours a day on their Iridium
pager.
Iridium satellite service is authorized in more than 120 countries and
territories around the world, with more than 200 markets expected by year-end.
More than 270 distribution agreements have been negotiated worldwide, with
service providers and roaming partners, which will provide Iridium access to
over 105 million wireless telephone customers in 125 countries.
Different Services for Different Needs
Iridium services include satellite, cellular, paging, and landline
communications capabilities, allowing customers to select the communication
options that best serve their needs. The phones allow cellular communications,
where available or compatible, or satellite service when outside the range of
terrestrial wireless networks. Combined, Iridium service will offer customers
on the move the lowest cost option available to meet their global
communications requirements. Customers can choose one or more of the following
Iridium services.
- - Iridium World Satellite Service provides a direct satellite link to a
handheld satellite phone, both for incoming and outgoing
communications in remote areas, poorly covered regions, and other
locations where terrestrial networks are not available.
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- - Iridium World Roaming Service allows customers to roam across
previously incompatible terrestrial wireless networks, enabling them
to keep one telephone number and receive one telephone bill for calls
made anywhere on Earth.
- - Iridium World Page Service will provide global alphanumeric messaging
to belt-worn pagers. When combined with the voice mail option,
customers can be sure that callers can reach them worldwide, including
on aircraft. Iridium World Page Service will be available beginning
in mid-November, 1998.
- - Iridium World Calling Card enables customers to make phone calls from
public and private wireline and wireless phones in 58 countries around
the world. To use Iridium World Calling Card service, users simply
dial an access code (toll-free where available) for the country in
which they are located, enter their account number, followed by the
destination number. Calls are billed directly to the users calling
card.
The Vital Link: The World's First Satellite Handheld Telephones
Motorola and Kyocera, the manufacturers of Iridium satellite telephones and
pagers, are expected to produce more than 100,000 satellite telephones in 1998.
The multi-mode Iridium telephones from Motorola and Kyocera include Subscriber
Identity Module (SIM) cards, which provide personalized telephone features and
security for the owner. The phones also use plug-in radio cassettes to provide
compatibility with different local cellular systems around the world.
Motorola will provide cellular cassettes for GSM 900 and CDMA/AMPS/NAMPS 800
standards at commercial activation, and Kyocera phones will support GSM 900 and
PDC standards.
Local and Global Customer Care
Because Iridium is a worldwide service, a Global Customer Care (GCC) program
has been implemented to provide toll-free, round-the-clock, international
support to global travelers. This includes helping customers with replacement
of lost or stolen
<PAGE> 4
equipment, resolving network and equipment-related issues, and providing system
coverage support.
The GCC program is designed to complement the customer care efforts of
Iridium's service providers by offering quality service to customers who are
outside their home area. When customers are in their home area, they can
contact their local service provider's customer care center for Iridium sales
support, account maintenance, product and service assistance, billing
inquiries, and all other Iridium needs.
Those interested in Iridium service can call Iridium Customer Care toll-free
at 1-877-691-0162, to find out more about Iridium service availability in their
particular country, or in countries to which they travel. Information also
can be obtained through the Iridium Web site, www.iridium.com.
Iridium is a global wireless communications network that combines the worldwide
reach of 66 low-earth-orbit satellites with land-based wireless systems to
enable subscribers to communicate using handheld telephones and pagers
virtually anywhere in the world. Iridium World Communications, Ltd. (NASDAQ:
IRIDF) is the public investment vehicle of Iridium LLC.
###
Iridium is a registered trademark and service mark of Iridium LLC (C) 1998
